When paying for invoices or reimbursements with bank transfers from your Moss wallet (Pay with Moss), you may face a situation where the payment is returned by the beneficiary, and in turn it will be marked as PAYMENT FAILED on the Payments tab. A payment can be returned due to different reasons, such as the beneficiary's account being closed or blocked, arbitrary compliance decisions from the beneficiary's bank, or simply the beneficiary returns the payment to the sender based on their own criteria. When this happens you will receive the returned payment in your Moss wallet and therefore it may affect your accounting.
In this article, we will cover payments (with and without FX/Payment fees) that were either exported or not to the ERP system before they were returned, and their status changed to PAYMENT FAILED.
The following examples are from the perspective of an EU based organisation with EUR as their home currency.
In both cases (with and without FX/Payment fees) you will see the following payment details:
When a payment is returned, the payment item will be marked with status PAYMENT FAILED on the Payments page, allowing you to decide next actions (e.g. retrying the payment):
On the Wallets page and on the Statement page you will see 2 lines:
one reflects to the outgoing payment
the other reflects the amount returned as incoming payment to your Moss wallet
Example of a statement:
How to reflect returned payments in your accounting platform
Case 1: Domestic payments
No payment fee and no FX difference incurred. If a SEPA payment was rejected or returned, then it implies that there were no additional costs. Thus, the full amount will be returned to your Moss wallet.
If the invoice has not been exported yet or only the expense part has been exported, you should repeat the payment (after the rejection issue has been fixed):
If Invoice was not exported at all then: Export the invoice as normal (the payment is exported together with the invoice)
You will have no inconsistencies in your accounting system, as the payment and invoice was only exported once the issue was fixed
If the expense part has been exported before: Only the payment needs to be exported
This way you can ensure that your accounting system holds all the relevant data
If you have already exported the invoice with the payment details and the payment fails, you can:
Revert the payment from the accounting/ERP system
This ensures that you have no incorrect payment data in your accounting/ERP system, for payments that did not go through
If you repeat the payment after fixing the issue you need to revert/delete the previous export in your accounting software and after that you need to export the payment again
This ensures that the payment date is correct
Case 2: Payments in foreign currencies
Where a Payment fee and/or FX difference was incurred.
In case of payments made in foreign currencies, a payment and/or FX difference may occur, where the amount transferred back to your account may differ from the amount you've originally paid due to exchange rate fluctuations and/or fees of the original payment not being refunded.
Example: assuming an exchange rate of 1 EUR = 1.4 CAD:
Outgoing payment of CAD 1000
EUR conversion: €714.28
Payment fee: €5
FX fee: €14.28
Total EUR needed to complete payment: €733.56
Payment returned by beneficiary, where CAD 1000 are converted with an exchange rate of
1 EUR = 1.5 CADdue to currency fluctuations:EUR received: €666.67
No payment fees nor FX fees are refunded by the beneficiary as they were only incurred at the point of making the payment by the sender.
The generic way to deal with such situation is the following:
If you have already exported the invoice and the payment, then:
Revert the body of the payment (amount paid to the vendor) from the Accounting/ERP system and leave Payment fee/Realised FX gains (losses) in the Accounting/ERP system.
Repeat the payment (after fixing the issue that caused the rejection)
Export the payment part again.
In this case, you will have the following details in the ERP system:expense and fees/FX difference from the first export (you only removed the main amount paid to the vendor here)
payment amount and another set of fees/FX difference from the last export
If you have not yet exported the invoice and the payment, then
Export the invoice (payment will be exported automatically with the invoice)
Record the fees/FX difference from the failed payment (as fees and FX difference will not be returned to your account).